|Bid||46.61 x 1100|
|Ask||50.64 x 1400|
|Day's Range||50.16 - 51.40|
|52 Week Range||40.52 - 54.27|
|Beta (5Y Monthly)||1.12|
|PE Ratio (TTM)||13.07|
|Forward Dividend & Yield||1.24 (2.42%)|
|1y Target Est||N/A|
"ICEO sounds a little better than interim CEO," BNY Mellon’s Todd Gibbons quipped when he was introduced as the latter Wednesday morning at the 2019 Goldman Sachs U.S. Financial Services Conference in New York. BNY Mellon (NYSE:BK) has been quiet about the search for a permanent successor to Charlie Scharf, its CEO of two years who departed abruptly for the top job at Wells Fargo & Co. Gibbons, who joined the global investments company in 1986, served most recently served as vice chairman and CEO of clearing, markets and client management, and before that was CFO for nine years. Gibbons and CFO Mike Santomassimo talked strategy and answered questions posed by financial analysts at the annual two-day conference.
(Bloomberg Opinion) -- For those following 2020 market outlooks, the past two days have been dominated by BlackRock Inc. The world’s largest money manager began unveiling its calls for the coming year on Monday, and on Tuesday it added TV appearances and journalist discussions with its most senior investors and strategists around the globe.The broadest takeaway is that 2019’s “extraordinary returns” across asset classes won’t continue over the next 12 months. That’s not particularly riveting, though, given that BlackRock itself said in 2016 that investors should expect smaller gains for pretty much everything in the coming five years. In 2017, Bill Gross made a similar call. And around this time last year, Ray Dalio, founder of Bridgewater Associates and recent mentor to hip-hop entrepreneur Sean “Diddy” Combs, argued investors “need to prepare for lower expected returns in the future.” After the longest expansion in U.S. history, it’s a fairly safe call to make.A bolder call from the money manager: Inflation poses the biggest risk in 2020 — or, at least, it’s what investors don’t seem to have on their radar. Here’s how BlackRock Vice Chairman Philipp Hildebrand explained it on Bloomberg TV:“The market is not expecting anything around inflation, basically, and I suspect that when we see each other a year from now, look back at this, we will say ‘wow, inflation actually was a bit more of a story than we thought.’ Again, I don’t think we need to worry. I don’t want in any way to paint the picture of dramatic inflation, but I do think when you look at the details, when you look at the employment report, when you look even at the latest European numbers, wage pressures are at peak expansion levels, so I do expect that inflation is one of the underappreciated risks for 2020.”Hildebrand is a former Swiss National Bank president, so he’s intimately familiar with global central bankers’ inability to stoke price growth in the wake of the global financial crisis. Critics might dismiss the outlook for relying on the Phillips Curve and other assumptions that don’t truly stand up to scrutiny in this economy. Just last week, University of Michigan survey data showed Americans expect prices to rise by just 2.3% annually over the next five to 10 years, matching the lowest level on record. The thing is, BlackRock is hardly alone in thinking 2020 might finally be the year inflation stages a comeback. And the advice is simple: Buy Treasury Inflation-Protected Securities.Bank of New York Mellon Corp.’s 2020 macro outlook is titled “Inflation Insurance Is Underrated.” Bank of America Corp.’s best technical trade for next year is to buy U.S. 10-year TIPS breakevens. Even Steven Major at HSBC Holdings Plc, who has one of the lowest year-end 2020 forecasts for 10-year U.S. yields, at 1.5%, said TIPS appear “underappreciated” and “offer attractive diversification properties.” Citigroup Inc. strategists went so far as to raise the specter of stagflation: “We see some upside risks to inflation. If these materialize against a weaker growth backdrop, it would be a bad combination for risk assets.” BlackRock, too, is pondering whether the push toward de-globalization will push prices higher because of supply shocks while economic growth slows. It lists stagflation as a “potential regime shift” from the current one, dubbed “slowdown.”Now, betting on higher-than-expected inflation isn’t as cheap as it was two months ago. The 10-year breakeven rate dipped to 1.47 percentage points on Oct. 8, the lowest in more than three years. It has climbed to 1.7 percentage points since then. The measure reflects the difference between yields for nominal and inflation-linked bonds. When it’s low, it indicates traders don’t see much reason to shield themselves from accelerating price growth over the next decade. The recent peak was 2.2 percentage points in May 2018.This talk about reviving inflation happens to coincide with the recent death of Paul Volcker, the former Federal Reserve chairman who famously tamed double-digit price growth. As David Beckworth, a former economist at the Treasury Department, noted on Twitter, spiraling inflation was viewed by some Americans in the 1970s and early 1980s as the most important issue facing the country.That context is crucial because it’s unclear what a meaningful bump higher in inflation would mean to a general public that hasn’t seen the core consumer price index at 2.5% in more than a decade, or at 3% since the mid-1990s (it peaked at 13.6% in 1980). Would it rattle the American consumer’s seemingly unshakable confidence? Or is this just more of Wall Street and the Fed getting worked up over tenths of percentage points in a measure that some consider detached from reality anyway?Crucially, the Fed appears willing to tolerate higher inflation in something of a “make-up strategy” after years of undershooting 2%. Typically, stocks and other risky assets might balk at quicker price growth on bets that the central bank would raise interest rates. But it’s difficult to even fathom what sort of conditions would make Chair Jerome Powell and his colleagues consider increasing the fed funds rate again after reducing it three times in as many months. That means inflation in 2020 might not produce the usual chain reaction.Even if the inflation rebound story isn’t persuasive, consider this: TIPS are on pace to top Treasuries again in 2019, which would be the third year in the past four that the inflation-linked securities outperformed. They may not be the sexiest investment out there, but in BlackRock’s eyes, TIPS are for winners.To contact the author of this story: Brian Chappatta at email@example.comTo contact the editor responsible for this story: Daniel Niemi at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Brian Chappatta is a Bloomberg Opinion columnist covering debt markets. He previously covered bonds for Bloomberg News. He is also a CFA charterholder.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Todd Gibbons, Interim Chief Executive Officer, and Mike Santomassimo, Chief Financial Officer, will speak at the 2019 Goldman Sachs U.S. Financial Services Conference in New York at 11:30 a.m. EST on Wednesday, December 11, 2019. The discussion may include forward-looking statements and other material information.
We are still in an overall bull market and many stocks that smart money investors were piling into surged through November 22nd. Among them, Facebook and Microsoft ranked among the top 3 picks and these stocks gained 52% and 49% respectively. Hedge funds' top 3 stock picks returned 39.1% this year and beat the S&P […]
The portfolio backing this transaction consists of UK prime residential loans originated by The Co-operative Bank plc. The transaction features a schedule amortisation for Class A based on an annual 7% repayment rate of the underlying pool; any principal repayment above this rate will be used by the originator to purchase additional loans until the end of the replenishment period in September 2023. The rating takes into account the credit quality of the underlying mortgage loan pool, from which Moody's determined the MILAN Credit Enhancement and the portfolio expected loss, as well as the transaction structure and legal considerations. The expected portfolio loss of 1.5% and the MILAN required credit enhancement of 12.0% serve as input parameters for Moody's cash flow model and tranching model, which is based on a probabilistic lognormal distribution.
(Bloomberg Opinion) -- The global stock market drifted lower on Monday, posting its biggest decline in more than three weeks. Yes, there’s still plenty of time for equities to recover and gain for a sixth consecutive week, which would match their longest winning streak since they advanced for 10 consecutive weeks over the course of late 2017 and early 2018. But doing so may hinge on a critical event Tuesday. Even with the modest decline, the MSCI All-Country World Index is still up 19% this year. The surge in recent weeks is due largely to optimism that the U.S. and China are close to reaching an agreement on “phase one” of a broad trade deal. It doesn’t matter that the details are likely to be modest; what matters is that it would signal that the trade war isn’t worsening. That’s why President Donald Trump’s address to the Economic Club of New York on Tuesday is so critical. No one is quite sure which Trump will show up. Will it be the one who in recent weeks has trumpeted progress in trade talks, or will it be the one who has said that the U.S. hasn’t agreed to a rollback of tariffs on China, which is what the markets truly want? This is no small matter for investors. Various surveys have shown that trade uncertainty is the primary risk facing markets. In that sense, whatever Trump says on Tuesday has the potential to either ratify the rally or bolster the case that it’s built on little more than hope. And as everyone in markets learns on their first day in the business, hope isn’t a strategy. “Markets have been skittish waiting for any concrete information about the trade talks,” Matt Forester, the chief investment officer at BNY Mellon’s Lockwood Advisors, told Bloomberg News. At 15 times forecast earnings for the following year, the MSCI is trading at its most expensive level since the start of 2018.Trump’s talk is not the only big event for markets this week. Federal Reserve Chairman Jerome Powell will address the Joint Economic Committee of Congress on Wednesday, the same day as the start of public impeachment hearings against Trump. The U.S. Labor Department will also provide an update on inflation for October. The week ends with data on U.S. retail sales for October, which economists hope will be a reversal from September’s big miss to the downside. But as already stated, hope has no place in markets.THE BOND GAME ISN’T OVER YETThe bad news for the bond market is that November isn’t even halfway over and it’s already the worst month for fixed-income investors since April 2018, with the Bloomberg Barclays Global Aggregate Index down 1.40% as of Friday. The good news is that there’s plenty of time for the bond market to rebound. And just as with the stock market, Trump’s appearance at Economic Club of New York — along with Powell’s testimony — may determine whether the recent sell-off in fixed-income assets is overdone. That’s the short-run prognosis. In a nod to John Maynard Keynes, bonds are dead in the long run anyway. Well, at least according to Moody’s Investors Service they are. The credit ratings company put out a research report Monday saying the rising tide of populism spreading round the world has caused it to turn “negative” on global sovereign credit for 2020. Unpredictable domestic and geopolitical risks along with a push for populist policies that weaken institutions, help slow growth and boost the risk of economic and financial shocks means governments will struggle to address credit challenges, Moody’s wrote. That’s scary, but the major ratings companies aren’t known for their astute political science observations. Yields on 10-year Treasury notes are lower now than when S&P Global Ratings stripped the U.S. of its AAA rating in August 2011.GO BIG OR GO HOMEThe thing about bond sell-offs in recent years is that have tended to be short-lived, thanks largely to central banks. The collective balance sheet assets of the Fed, European Central Bank, Bank of Japan and Bank of England rose to 35.7% of their countries’ total gross domestic product in October from about 10% before the financial crisis, according to data compiled by Bloomberg. And judging by some of the latest moves made by the ECB, bond traders can be a little less worried about a lack of buyers. The ECB started its second round of corporate bond purchases by acquiring in a week an amount that analysts expected it to buy in a month, according to Bloomberg News’s Tasos Vossos. The central bank bought almost 2.8 billion euros ($3 billion) of company debt securities in the week to Nov. 8, according to data released Monday. It was the second-largest weekly purchase figure since the ECB first adopted the strategy, known as quantitative easing, in June 2016. The bank suspended the program last December and restarted it at the beginning of this month as growth flagged across the euro area. It’s unknown whether the faster pace of purchases is in response to the big drop in bond prices and corresponding jump in yields, but it should be comforting to know that the ECB is doing its part to stem the weakness.CHILE GIVES INIt’s becoming routine to see the Chilean peso leading the list of biggest losers in the foreign-exchange market on any given day, and Monday was no exception. The peso weakened 1.72% to a record low, bringing its depreciation since Oct. 18 to 6.39%. To put that into context, the next biggest loser among the 31 major currencies tracked by Bloomberg, the Argentine peso, has dropped just 2.48%. It’s well known by now that the populist movement that Moody’s warned about on Monday has erupted in Chile, where a wave of protests has disrupted the economy and government. The latest move lower in the peso came as the administration of President Sebastian Pinera said it would overhaul the constitution drawn up during the dictatorship of Augusto Pinochet to calm three weeks of mass protests. So why did the peso and Chile’s equity market, which fell 1.52%, take it so harshly? Many people regard the constitution, drawn up under the dictatorship of Pinochet, as the foundation of an economic system that privatized pensions and much of health care and education, a chief grievance of protesters, according to Bloomberg News’s Javiera Baeza and Eduardo Thomson. It also enshrined the strict legal safeguards to private property that are behind Chile’s water privatization, a controversial subject in a country struggling with severe droughts.NATURAL GAS STUMBLESThe natural gas market cares little about trade wars or populism. To traders there, it’s all about the weather. Natural gas futures slid the most since January as forecasts showed that a cold snap descending on the U.S. would peter out by the end of the month, curbing demand at the time of year when consumption of the heating gas usually surges, according to Bloomberg News’s Christine Buurma and Naureen S. Malik. Gas was the worst-performing major commodity Monday, tumbling as much as 6.1%. Temperatures will probably be mostly normal in the eastern half of the country Nov. 21 through Nov. 25 as an autumn chill fades, according to Commodity Weather Group LLC. Beyond the weather, the slide in natural gas underscores how record production from shale basins continues to weigh on the market even as exports soar and the power industry becomes more reliant on the fuel. Without a sustained Arctic chill this winter, stockpiles will remain above normal for the time of year, pressuring prices lower, according to Buurma and Malik. As they point out, hedge funds are adding to the bearish momentum, holding the largest short position since 2015 for the time of year.TEA LEAVESWhen the National Federation of Independent Business said a month ago that its small-business sentiment index for September fell to near the lowest level of Trump’s presidency, it noted that the part of the gauge measuring “uncertainty” plunged to its lowest since February 2016. “More owners are unable to make a statement confidently, good or bad, about the future of economic conditions,” the group said, with 30% of respondents reporting “negative effects” from tariffs. Don’t expect much improvement when the group provides an update on Tuesday. The median estimate of economists surveyed by Bloomberg is for a reading of 102 for October, little changed from 101.8 in September. Bloomberg Economics points out that small-business activity has been moderating since the last report. Most notably, the ADP private employment survey indicated recently that net hiring has shrunk to half the pace that prevailed last year, to the slowest since 2011.DON’T MISS Buying Stocks at Records Works Until It Doesn’t: Robert Burgess Investors’ Global Turn Depends on Policy Hopes: Mohamed El-Erian Delaying the IPO Process Weakens Capitalism: Stacey Cunningham U.S. Economy Has Recovered, But Labor Market Hasn’t: Karl Smith The 2020 Economy Should Feel a Lot Better Than 2019: Conor SenTo contact the author of this story: Robert Burgess at email@example.comTo contact the editor responsible for this story: Daniel Niemi at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Robert Burgess is an editor for Bloomberg Opinion. He is the former global executive editor in charge of financial markets for Bloomberg News. As managing editor, he led the company’s news coverage of credit markets during the global financial crisis.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Moody's Investors Service ("Moody's") has assigned a definitive rating of Aaa (sf) to the Class A tax lien asset backed bonds issued by NYCTL 2019-A Trust, sponsored by The City of New York (NYC, Aa1 stable). The transaction is collateralized by a static pool of unpaid tax liens levied on commercial and residential properties, including unpaid real property taxes, assessments, sewer and water rents, sewer surcharges, amongst other city infrastructure and service charges.
(Bloomberg Opinion) -- The top-line takeaway from a BNY Mellon Investment Management national survey on fixed-income investing was stunning: A measly 8% of Americans were able to accurately define fixed-income investments.The 29-question online survey of just more than 2,000 adults, conducted in July, clearly shows that many Americans admit to having little knowledge about various fixed-income markets and how to invest in them. Here’s a rundown of those who answered “I do not understand it at all” with regard to the following types of bonds: Treasuries, 39%; municipal bonds, 45%; high-yield bonds, 46%; corporate bonds, 51%; structured products, 53%; Treasury Inflation Protected Securities, 63%. Of the 849 respondents who don’t own fixed income or don’t have any investment portfolio, 44% said they don’t buy bonds because they don’t understand the different types of securities.That’s not particularly heartening to see as someone who writes about all those bond markets, though I can’t say any of those numbers are shocking. Still, it doesn’t quite explain how fewer than one in 10 Americans can correctly define fixed-income investing. It’s one thing to admit you know nothing about subprime auto asset-backed securities or collateralized loan obligations. It’s quite another if you can’t identify a core element of investing, especially considering the definition is practically baked into the name.After digging into the survey and its questions, it’s clear that 92% of Americans aren’t truly illiterate about the bond market, but it’s also obvious that more investors need a better handle on what fixed income is all about. So, what is the correct definition of a fixed-income investment, and what were the other options in the survey? Here’s the breakdown:I’m not disputing that the middle definition, selected by just 8% of respondents, is the “best answer” here. It is. At the same time, I’ve taken my fair share of multiple-choice tests (finance-related and otherwise), and I can spot a tricky question when I see one.As I said before, fixed-income investing shouldn’t be beyond comprehension given that its core purpose is right there in the name. And yet, while the first two choices in the survey both conspicuously use the word “fixed,” the correct answer substitutes the word “periodic” instead. Again, this is not wrong. But that kind of phrasing, combined with the first two answers having elements of fixed-income investing, sheds some light on that 8% headline figure.The first answer, which 42% of respondents selected, is admittedly “not bad,” said Gautam Khanna, a senior portfolio manager at Insight Investment, an asset manager under the BNY Mellon umbrella. He wasn’t involved in the survey. Still, the results show “people generally have a lack of understanding of what fixed income is in the fullest sense,” he said in a phone interview. “Perhaps some people view it as ‘I have money sitting in a CD and that’s my fixed income,’ or ‘I’ve got money sitting in a savings account.’” Those options don’t provide the diversification benefits of owning assets such as Treasuries or high-quality corporate bonds, which tend to gain in price when equities decline, he said.All of that is true, of course. And yet, I find it hard to outright dismiss almost half of survey participants for selecting an answer that was close, but not quite thorough enough. In fact, the “true or false” segment is perhaps a better indicator that Americans have at least a fundamental understanding of bond investing, even if they’re not quite proficient in certain strategies. A respectable 70% of respondents knew it’s false that “all bonds provide the same level of risk,” and 87% marked as false that “all bonds provide the same level of income.” Interestingly, BNY Mellon Investment Management highlighted the following answer as an example of the lack of understanding of bond markets: 28% of respondents said it’s true that “fixed income investing is intended only for retirement planning.”“Fixed income provides some of the most versatile and vibrant investment options available and yet there exists around it a sense of confusion and misperception,” Andy Provencher, head of North American distribution at the money manager, said in a statement. “Chief among these is that fixed income plays an important role solely in the immediate run-up to retirement.” Yes, fixed-income investments can provide a stabilizing force in a portfolio at any age and a way to mitigate big price swings from riskier assets. But I wouldn’t call those 28% of respondents wildly off base, either. Consider this: BlackRock Inc.’s LifePath Index 2025 fund, which is meant for those retiring in about six years, has a 44% allocation to fixed-income assets. The 2055 fund has just 1.3%. Why is that? Because younger people are typically better off taking more risk and shifting their funds into fixed income as they approach retirement age. That impetus is most likely only stronger when U.S. stock markets have climbed to records while trillions of dollars in bonds around the world yield less than zero.It’s overstating the case to conclude that the overwhelming majority of Americans are fixed-income illiterate. But with the global bond market growing by the day, it’s clear many of them could use a lesson or two in what role the securities can play in their financial lives.To contact the author of this story: Brian Chappatta at email@example.comTo contact the editor responsible for this story: Daniel Niemi at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Brian Chappatta is a Bloomberg Opinion columnist covering debt markets. He previously covered bonds for Bloomberg News. He is also a CFA charterholder.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
The tax-exempt bonds are collateralized by a single fixed-rate loan (the "Liberty Debt loan") secured by the borrower's leasehold interest in the Bank of America Tower at One Bryant Park (the "property"), a 2.4 million SF, 51-story, Class A office property located in Midtown Manhattan. The property is well located across the street from Bryant Park at the northwest corner of 42nd Street and Sixth Avenue.
Some The Bank of New York Mellon Corporation (NYSE:BK) shareholders may be a little concerned to see that the Senior...
State Street's (STT) Q3 earnings reflect successful implementation of cost saving measures and rise in assets balance, while lower revenues pose a concern.
The search for BNY Mellon’s next chief executive has been initiated, interim CEO Todd Gibbons told financial analysts during the custodian bank‘s third quarter earnings call on Wednesday, but don’t expect any strategic changes as the international investments giant looks to speed its shift to automation over manual processes. “Looking ahead to 2020 and the things we can accelerate ... we can increase the scalability of applying machine learning,” Gibbons said. “It doesn’t seem like a lot, but when you think about what we do, it’s a massive undertaking with huge headcounts,” Gibbons said.
BNY Mellon (BK) witnesses lower revenues in the third quarter of 2019. However, lower expenses and rise in AUM support results to quite an extent.
Bank of New York Mellon Corp reported a better-than-expected quarterly profit on Wednesday, as the world's largest custodian bank cut costs to counter weakness in its investment management business and lower interest rates. "Interest rate headwinds and deposit mix continue to challenge net interest revenue and asset management continues to be negatively impacted by prior-year outflows," Interim Chief Executive Officer Todd Gibbons said in a statement. Gibbons took the helm after Charles Scharf left to take up the top job at Wells Fargo.